Torid Company Processes 18,700 Gallons of Direct Materials to Produce

question 51

Multiple Choice

Torid Company processes 18,700 gallons of direct materials to produce two products, Product X and Product Y. Product X sells for $10 per gallon and Product Y, the main product, sells for $150 per gallon. The following information is for December:

The manufacturing costs totalled $30,000.
How much is the ending inventory for the byproduct if byproducts are recognized in the general ledger at the point of sale?

• A) $0
• B) $1750
• C) $3000
• D) $26,250

---

Definitions:

Statement of Financial Position

A financial statement that shows an entity's assets, liabilities, and equity at a specific point in time, providing a snapshot of its financial condition.

Disclosed and Reconciled

The process in which financial activities are explained in detail and discrepancies between different accounts or reports are resolved.

Dividends Paid

The amount distributed to shareholders from a company's earnings in the form of cash or additional shares.